EXHIBIT 10(23)
DATED September 8, 2000
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(1) GROSVENOR WEST END PROPERTIES
(2) CANARGO ENERGY CORPORATION
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UNDERLEASE
of first and second floors 148/150 Buckingham Palace Road
London SW1
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From: 24 June 2000
Term: 10 years
Expires: 23 June 2010
Initial rent: UK Pounds 141,950
DATED September 8, 2000
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(1) GROSVENOR WEST END PROPERTIES
(2) CANARGO ENERGY CORPORATION
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Counterpart/
UNDERLEASE
of first and second floors 148/150 Buckingham Palace Road
London SW1
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From: 24 June 2000
Term: 10 years
Expires: 23 June 2010
Initial rent: UK Pounds 141,950
INDEX
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INTERPRETATION .....................................................1
Defined terms...............................................1
End of the Term.............................................6
Landlord and Tenant (Covenants) Act.........................7
Construction of obligations.................................7
Statutes....................................................7
Value Added Tax.............................................7
Indemnities.................................................8
Superior interests..........................................8
Approvals...................................................8
Vitiation of insurance......................................8
Parties and joint and several obligations...................9
Clause numbers..............................................9
TERM RIGHTS & RENTS.................................................9
TENANT'S COVENANTS..................................................10
Rent........................................................10
Interest on arrears.........................................10
Outgoings...................................................11
Empty rates.................................................11
Value Added Tax.............................................11
Gas electricity and other services..........................12
Repair......................................................12
To clean windows............................................12
Internal decoration.........................................12
Standard of works...........................................13
Reinstatement and delivery at end of Term...................13
Alienation..................................................14
Enforcement of underlease terms.............................14
Registration of dealings....................................15
Alterations.................................................15
Permitted user..............................................15
No nuisance.................................................15
No overloading..............................................16
Other restrictions..........................................16
Contamination...............................................16
Waste and refuse............................................16
Plant and machinery.........................................17
Aerials.....................................................17
Signs.......................................................17
Preservation of rights and boundaries.......................18
Reletting notices...........................................18
Rights of entry.............................................18
To permit Landlord to remedy breach.........................19
Statutory obligations.......................................20
Copies of notices...........................................20
To pay charges under Planning Acts..........................21
No planning applications etc without consent................21
Copies of permissions.......................................21
To obtain approval of permissions...........................21
To complete works before end of Term........................21
Landlord's costs............................................22
Indemnities.................................................23
Regulations.................................................23
LANDLORD'S COVENANTS................................................23
Quiet enjoyment.............................................23
Compliance with superior lease..............................23
Services....................................................23
Access to data hub..........................................24
INSURANCE OBLIGATIONS...............................................24
Landlord to effect insurance................................24
Landlord to obtain consents for rebuilding..................24
Landlord to reinstate (other than minor damage).............25
Cesser of rent..............................................26
Tenant's insurance obligations..............................26
PROVISOS............................................................28
Forfeiture..................................................28
No implied rights...........................................29
No restrictions on adjoining property.......................29
Exclusion of liability......................................29
Compensation................................................29
Service of notices..........................................30
Alterations to the Communal Garden..........................30
Representations.............................................30
Disputes....................................................31
Exclusion of third party rights.............................31
Sums due to Landlord treated as rent........................31
Stamp duty certificate......................................31
Governing law and jurisdiction..............................31
RENT REVIEW.........................................................32
Frequency of review.........................................32
Upwards only reviews........................................32
Basis of valuation..........................................32
Treatment of rent free periods..............................34
Method of determination.....................................35
Interim arrangements........................................36
Time not of the essence.....................................36
Statutory restrictions......................................37
Memoranda...................... ............................37
SCHEDULE 1..........................................................37
(Particulars of the Premises)...............................37
SCHEDULE 2..........................................................38
(Rights granted)............................................38
SCHEDULE 3..........................................................39
(Exceptions and reservations)...............................39
SCHEDULE 4..........................................................40
(The Service Charge)........................................40
(Definitions)...............................................40
(Calculation and payment)...................................41
(Services)..................................................44
(Expenses)..................................................45
SCHEDULE 5..........................................................48
(Alienation conditions).....................................48
(Requirements for an assignment)............................48
(General requirements)......................................50
THIS UNDERLEASE made the 8th day of September 2000
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BETWEEN:
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(1) GROSVENOR WEST END PROPERTIES (Company Registration Number 956235)
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whose registered office is at 70 Grosvenor Street London W1X 9DB ("the
Landlord") and
(2) CANARGO ENERGY CORPORATION whose registered office is at 32 Loockerman
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Square Suite L-100 Dover Delaware 19904 Dover Kent (address for service
in the UK is c/o McGrigor Donald 63 Queen Victoria Street London EC4N
4ST ("the Tenant")
WITNESSES as follows:
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INTERPRETATION
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1. IN this Lease the headings and index shall be ignored in its construction
and unless the context otherwise requires:
Defined terms
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1.1 The following expressions have the meanings set against them:
"Basic Rent" the rent payable under Clause 2.1
"Building" the whole and each part of the land and building
known as 148/150 Buckingham Palace Road London SW1 for
identification purposes only edged green on the attached
plan being the land registered at H M Land Registry under
title number NGL772951 including:
(a) any ancillary vaults
(b) all additions and alterations thereto
(c) all fixtures annexed thereto (except tenant's
fixtures)
"Common Parts" those parts of the Building which are not from time to
time let or intended to be let to any occupational
tenants including (but without limiting the foregoing)
staircases entrance halls and coffee point on the third
floor of the Building
"Communal the garden at the rear of 126 to 158 Buckingham Palace
"Garden"Road London SW1
"Conduits" pipes sewers drains cisterns ducts gutters watercourses
wires cables channels flues telecommunications equipment
and other conducting media and any other ancillary
apparatus
"Contractual the date on which the contractual term created by Clause
Expiry Date" 2 will expire if the Term does not end earlier
"Full Cost of" such amount as the Landlord from time to time determines
Reinstatement as the cost of rebuilding the relevant part or parts of
the Building after destruction by an Insured Risk
( including the cost of shoring-up demolition site
clearance any works that may be required by statute
fees payable on any applications for planning permission
or other consents professional fees and other incidental
expenses ) when the rebuilding occurs including any
increases in building costs up to the time of completion
"Insurance Rent" such sums as shall be a fair proportion (as determined
from time to time by the Landlord save in the case of
loss of Rent when the proportion shall be 100%) of the
amount which the Landlord pays by way of gross premium
(or if the Premises or the Building are insured with
other property where applicable a fair proportion of such
sums payable under the relevant insurance policy
determined from time to time by the Landlord):
(1) for effecting insurance under Clause 5.1 and
(2) in respect of the Landlord's Liability Insurance
Together with the said proportion of:
(3) all expenses incurred by the Landlord in connection
with assessing the Full Cost of Reinstatement of the
Building provided that the Tenant shall not be liable
for the cost of assessment any more than once in
every year of the Term and
(4) any excesses under any policy of insurance effected
by the Landlord under Clause 5.1 in respect of any
Insured Damage that occurs
"Insured damage or destruction to any part of the Building which is
Damage" caused by a risk against which and to the extent that at
the time of the damage or destruction the Landlord has or
should have effected insurance of that part of the
Building under Clause 5.1
"Insured fire lightning storm explosion impact aircraft and other
Risks" aerial devices and articles dropped therefrom riot
malicious damage civil commotion earthquake (fire and
shock) bursting or overflowing of water tanks apparatus
or pipes subsidence heave landslip for so long as each
such risk remains insurable with insurers of repute at
reasonable commercial rates or is actually insured by the
Landlord in its discretion for the purposes of this Lease
together with such other risks of damage or destruction
against which the Landlord from time to time decides to
effects insurance for the purposes of this Lease (if any)
"Landlord's insurance against all liability of the Landlord to third
Liability parties arising out of or in connection with the Building
Insurance" or any matter relating to the Building on such terms and in
such amount as the Landlord from time to time determines
"Loss of the amount of the Rents for the time being payable during
Rent" a period of three years (or for so long as the Landlord so
elects during such longer period as the Landlord from time
to time reasonably determines necessary in order to
rebuild the Building) including any increase in the Basic
Rent during such period which the Landlord estimates will
occur as a result of any review due under Clause 7
"Outgoings" (in relation to the Building the Common Parts the Premises
or other property as the context requires) all present
and future rates charges taxes assessments impositions
and outgoings of any kind (including without limiting the
foregoing any which are of a capital or non-recurring
nature or wholly novel)assessed charged imposed or payable
by or on any owner or occupier of or on or in respect of
the Building the Common Parts the Premises or other
property respectively excluding (save for Value Added Tax)
any payable by the Landlord or any superior landlord
occasioned by receipt of the Rents or the rents payable
under a superior lease or by any dealing with any interest
in the Premises of the Landlord or any superior landlord
"Planning the Town and Country Planning Act 1990 the Planning(Listed
Acts" Buildings and Conservation Areas) Act 1990 and the
Planning (Hazardous Substances) Act 1990 and any other
statutes relating to town and country planning
"Plant" all plant and machinery now or hereafter in or serving
the Building including(but without limiting the foregoing)
any lifts and lift machinery boilers public address
system internal telephones air conditioning heating and
ventilation plant and machinery sprinklers and associated
Conduits electrical systems fire detection and fire
prevention systems central or monitoring systems and
installations and any plant and machinery from time to
time installed to replace any of the foregoing
"Premises" the whole and each part of the part of the first and
second floors of the Building more particularly described
in Schedule 1
"Prescribed four per cent per annum above the base rate of National
Rate" Westminster Bank plc or above such other rate of interest
as the Landlord from time to time reasonably determines
"Quarter Days" 25 March 24 June 29 September and 25 December in each year
"Rents" the Basic Rent the Insurance Rent and the Service Charge
"Service Charge"the sums payable by the Tenant at the times and in the
manner set out in
"Services" the services set out in Part III of Schedule 4
"Term" the term of years granted by Clause 2 with any period of
holding-over extension or continuance by statute or common
law
"Visitor" the Tenant any undertenant (however remote)of the whole or
any part of the Premises and any person at or near the
Building expressly or by implication with the authority of
the Tenant or any such undertenant
"1954 Act" the Landlord and Tenant Act 1954
End of the Term
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1.2 "The last year of the Term" and "the end of the Term" mean the last
twelve months of and the end of the Term however it ends (including by
expiry forfeiture or surrender)
Landlord and Tenant (Covenants) Act
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1.3 The expressions "excluded assignment" "authorised guarantee agreement"
and "collateral agreement" have in relation to this Lease the meanings
specified in Sections 11(1) 16 and 28(1) of the Landlord and Tenant
(Covenants) Act 1995
Construction of obligations
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1.4 Obligations by the Tenant:
1.4.1 not to do or omit to do anything in relation to the
Premises or the Building include an obligation to ensure that
It is not done or omitted by (in relation to the Premises)
Any other person and ( in relation to other parts of the
Building) any Visitor
1.4.2 to do anything in relation to the Premises or the Building
include an obligation to ensure that (in the case of the
Premises) all other persons and (in the case of other parts
of the Building) all Visitors comply with them
1.5 References to obligations of the Tenant in this Lease include
obligations of the Tenant in any document entered into pursuant to
this Lease and in any collateral agreement
Statutes
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1.6 References to a statute or a statutory instrument include any extension
amendment or re-enactment for the time being in force and any
regulations instruments permissions directions orders or notices for the
time being made or issued under them
Value Added Tax
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1.7 References to Value Added Tax include any similar tax substituted for or
levied in addition to it
Indemnities
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1.8 Obligations to indemnify the Landlord against a matter are obligations
to indemnify the Landlord against liabilities actions proceedings
damages penalties costs expenses claims and demands of whatsoever
nature and any fees and expenditure incurred arising directly or
indirectly from or in connection with that matter
Superior interests
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1.9 References to the Landlord include any superior landlord and any chargee
of the Landlord or of any superior landlord where:
1.9.1 the relevant superior lease or charge requires the approval
of the superior landlord or chargee to a matter and the
Landlord's approval to that matter is required under this
Lease (although nothing in this Lease shall prevent the
Superior landlord or chargee from withholding its approval if
it is entitled to do so under the relevant superior lease or
charge)
1.9.2 there is provision for repayment to the Landlord of any
expenses incurred and
1.9.3 there is an indemnity in favour of the Landlord
Approvals
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1.10 References to the approval or consent of or to a matter being approved
by a person are to its prior written approval or consent
Vitiation of insurance
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1.11 References to insurance being vitiated are to the insurance effected
under Clause 5.1 (and if relevant any other insurance effected by the
Landlord against damage or destruction to neighbouring property or
Landlord's Liability Insurance or other similar insurance) being
vitiated and/or payment of the insurance monies under such insurance
being refused in whole or part by reason of any act or omission by any
Visitor (whether or not also resulting from an act or omission by any
other person)
Parties and joint and several obligations
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1.12 References to "the Landlord" and "the Tenant" include the immediate
landlord and tenant for the time being under this Lease and (if
respectively more than one person) their obligations are joint and
several
Clause numbers
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1.13 Without further designation references to numbered Clauses and
Schedules are to clauses of and schedules to this Lease
TERM RIGHTS & RENTS
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2. THE Landlord LEASES the Premises to the Tenant
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TOGETHER WITH (in common with the Landlord those authorized by it and
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others with similar rights) the rights specified in
Schedule 2
RESERVING to the Landlord and those authorised by it the rights specified
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in Schedule 3
SUBJECT to all rights and obligations affecting the Premises
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TO HOLD to the Tenant from and including the 24th day of June 2000 for
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a term of ten years
PAYING to the Landlord:
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2.1 Yearly during the Term (and proportionately for any shorter period)
141,950 (One hundred and forty-one thousand and nine hundred and fifty
pounds) (subject to increase in accordance with Clause 7) by equal
quarterly payments in advance on the Quarter Days the first to be
made on the date of this Lease proportionate from and including the 18th
day of October 2000 to and including the 24th day of December 2000
2.2 By way of further rent the Insurance Rent on demand
2.3 By way of further rent the Service Charge
TENANT'S COVENANTS
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3. THE Tenant COVENANTS with the Landlord during the Term and thereafter as
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specified as follows:
Rent
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3.1 To pay the Rents:
3.1.1 in accordance with Clause 2 without any deduction and
not to exercise any right or claim to withhold rent
or legal or equitable set-off
3.1.2 (if so requested by the Landlord in writing) by standing
order to a bank account in the United Kingdom nominated
by the Landlord
Interest on arrears
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3.2 To pay the Landlord interest at the Prescribed Rate from when the rent
or other sum was due or incurred until actual payment or reimbursement
(whether formally demanded or not and before and after judgment) on:
3.2.1 any part of the Basic Rent unpaid on the due date
3.2.2 any other sum due under this Lease unpaid seven days after it is
due and
3.2.3 any sum incurred by the Landlord as a result of a failure by
the Tenant to comply with its obligations in this Lease
PROVIDED THAT this sub-clause is without prejudice to any other right
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of the Landlord and Rents and other sums shall be deemed unpaid if the
Landlord has refused to accept a payment so as not to waive a right to
forfeit this Lease
Outgoings
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3.3 To pay and indemnify the Landlord against all Outgoings which relate to
the Premises
Empty rates
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3.4 To make good to the Landlord any loss of rating relief for the Premises
applicable to empty premises which the Landlord suffers after the end
of the Term because the relief is allowed to the Tenant or any other
person for any earlier period
Value Added Tax
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3.5 To pay the Landlord as additional rent any Value Added Tax chargeable on
any payments or other consideration (including the Rents) made or given
by the Tenant under or in connection with this Lease such Value Added Tax
to be payable in addition to such payments or other consideration
3.6 Where under this Lease the Tenant agrees to pay the Landlord or any
other person (including without limitation by way of service charge
indemnity or reimbursement) a sum calculated by reference to an amount
expended by the Landlord or another person to pay in addition a sum equal
to any Value Added Tax on such amount save to the extent (if any) that
it will be recoverable by the Landlord or other person respectively
without (if respectively it has not done so) exercising any election
to waive exemption from Value Added Tax
Gas electricity and other services
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3.7 To pay to the suppliers all charges for gas electricity and other
services consumed or used at or in connection with the Premises and all
charges for meters and telephones and to comply with all regulations and
requirements of the supplying authorities insofar as they relate to
the Premises
Repair
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3.8 To keep the Premises (including the tiles carpeting and other furnishing
of the floors) in good and substantial repair and condition (including
decorative condition) and (when necessary) to renew and rebuild the
Premises except Insured Damage save where the insurance against such
Insured Damage is vitiated
3.9 To keep the Premises in a clean and tidy condition and clear of all
rubbish
3.10 To replace any landlord's fixtures in the Premises which are or become
beyond repair with other good quality fixtures
3.11 To give written notice to the Landlord of any defect or item requiring
repair in the Premises or the Building which might give rise to a common
law or statutory duty on the Landlord in favour of the Tenant or any
other person as soon as it comes to the attention of the Tenant or those
deriving title under it
3.12 To indemnify the Landlord against any breach of any such duty
To clean windows
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3.13 To clean the inside of all windows of the Premises as often as
necessary and at least once in every month
Internal decoration
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3.14 In the fifth year of the Term and in the last month of the last year of
the Term to paint enamel french polish or otherwise treat such parts
of the interior of the Premises as are or should be so treated with two
coats of good quality paint or best quality polish or other suitable
material of the best quality (the colour scheme and materials to be used
on the last such occasion during the Term to be such as is required by
the Landlord) and wash down all tiles and similar washable surfaces
3.15 In the last month of the last year of the Term to supply and lay
throughout the Premises new fitted carpets all such carpets to be of
no less quality than those in the Premises at the date of this Lease and
of a colour and design required by the Landlord acting reasonably
3.16 As often as is in the reasonable opinion of the Landlord necessary to
clean and treat in a proper manner and in accordance with any
instructions issued by the Landlord all other surfaces and fixtures
in the Premises not required to be painted
Standard of works
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3.17 To carry out the repairs decorations and other works required under
this Lease in a good and workmanlike manner and to the reasonable
satisfaction of the Landlord and in the last year of the term such
decorations are to be in colours reasonable approved by the Landlord
such approval for to be unreasonably withheld or delayed
Reinstatement and delivery at end of Term
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3.18 Before the end of the Term:
3.18.1 (save to the extent that the Landlord otherwise directs in
writing) to remove any additions or alterations made to the
Premises during the Term
3.18.2 to remove any advertisements or signs erected on or near the
Premises
3.18.3 to make good any damage caused by such removal and the removal of
tenant's fixtures and chattels
3.19 At the end of the Term to deliver the Premises up in repair and in
accordance with the Tenant's obligations in this Lease
Alienation
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3.20 Not to assign charge underlet hold on trust for another or otherwise
part with or share possession or occupation of or suffer any other
person to occupy or have an interest in the whole or any part of the
Premises save by way of an assignment charge or underletting of the
whole of the Premises or an underletting of part of the Premises
satisfying the relevant requirements of Schedule 5
Enforcement of underlease terms
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3.21 In relation to any underlease however remote of the whole or any part
of the Premises:
3.21.1 not to waive or vary its terms
3.21.2 to procure that the tenant for the time being complies with
the covenants given or which it should have given to the
Landlord pursuant to Part II of Schedule 6 and in any document
entered into by the Tenant pursuant to this Lease
3.21.3 to operate properly any provisions for the review of rent
thereby reserved so as to increase such rent to the
maximum extent in accordance with its terms
3.21.4 to submit to any court expert or arbitrator determining such
rent any representations that the Landlord reasonably requests
and
3.21.5 within fourteen days to give notice to the Landlord of the
details of the determination of every rent review
Registration of dealings
--------------------------
3.22 Within twenty-one days after any assignment charge underlease or
transmission or other disposition or devolution relating to the whole
or any part of the Premises or any derivative interest in them to give
notice of such to the Landlord and to produce to the Landlord a
certified copy of the relevant document and to pay the Landlord's
solicitors' proper charges for the registration of every such document
Alterations
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3.23 Not to erect any new buildings on the Premises nor to annex the
Premises to other premises nor to make any alterations or additions
which will alter the height elevation or architectural appearance of the
Premises and not to make any other external or any structural
alterations or additions to the Premises
3.24 Subject to Clause 3.23 not to make any other alterations or additions
to the Premises without the Landlord's approval (such approval not to be
unreasonably withheld or delayed) nor without having entered into such
obligations as the Landlord shall reasonably require as to their
execution and reinstatement
Permitted user
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3.25 To use the Premises only as business or professional office within
sub-class (a) of Class B1 of the Schedule to the Town and Country
Planning (Use Classes) Order 1987 (ignoring for this purpose any
Extension amendment or revocation of such Order made after the date of
this Lease) but not governmental or diplomatic offices
No nuisance
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3.26 Not to do on the Premises or the Building anything which in the opinion
of the Landlord may become or cause a nuisance disturbance damage
annoyance or inconvenience to the Landlord or its lessees or to the
owners or occupiers of neighbouring property
No overloading
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3.27 Not to do or bring in or on the Premises or the Building anything which
may put any weight or impose a strain in excess of that which the
Premises or the Building are designed to bear with due margin for safety
and not to fix any machinery to the walls ceilings or roof of the
Premises or the Building
Other restrictions
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3.28 To keep the entrance ways of and exits from the Premises clear and
unobstructed at all times and not to cause an obstruction in any part of
the Building
3.29 Not to hold any sale by auction on the Premises
3.30 Not to permit any person to sleep in the Premises nor to use the
Premises or the Building for any residential illegal or immoral purpose
or for the purposes of prostitution
3.31 Not to allow to pass into the sewers drains or watercourses serving the
Premises or the Building any noxious or deleterious effluent or other
Substance which may obstruct or damage them and to make good any such
obstruction or damage caused thereto by any Visitor
Contamination
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3.32 Not to allow any noxious or deleterious effluent or any form of
contaminant or pollutant or other substance to seep into or otherwise
enter the buildings or other structures on the Premises or the ground
below them
Waste and refuse
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3.33 Not to discharge trade effluent or waste without the approval of the
Landlord
3.34 To make proper and adequate arrangements for the frequent removal from
the Premises of all trade and other waste in accordance with the
requirements of any competent authority and any regulations from time
to time made by the Landlord
Plant and machinery
---------------------
3.35 Not without the approval of the Landlord to erect or install in the
Premises or the Building any engine or machinery or other appliance or
Apparatus of any description (other than usual office machinery in the
Premises) and to ensure that any such erected or installed is properly
installed and safely maintained and not liable to leak or cause a fire
or explosion
3.36 Not to overload the electrical wiring or drainage installations and
apparatus in or serving the Premises or the Building and to ensure that
any in or solely serving the Premises comply with the terms conditions
and regulations of the relevant authorities
3.37 To keep all Plant within and exclusively serving the Premises in
working order
Aerials
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3.38 Not to erect on the exterior of the Premises or the Building any pole
mast wire or aerial radio or television mast aerial or dish or any
erection of any kind whatsoever
Signs
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3.39 Not to fix or exhibit on the exterior of or (if visible from the
exterior) the interior of the Premises nor anywhere on the Building any
name-place bill sign placard notice fascia board flag banner blind
advertisement or similar device so that there shall be no indication
of the use of the Premises save with the approval of the Landlord
such approval not to be unreasonably withheld or delayed for one small
name-plate on or at the front entrance door of the Building or (if the
Landlord so requires) on the communal nameboard for the Building and
nameplates on the doors of the Premises
Preservation of rights and boundaries
-----------------------------------------
3.40 Not to obstruct any window or light enjoyed by the Premises and to use
best endeavours to prevent the loss of any right belonging to the
Premises
3.41 To prevent any encroachment on the Premises and the acquisition of any
right over the Premises and to notify the Landlord immediately if an
encroachment or the acquisition of a right is attempted or made
Reletting notices
------------------
3.42 To permit the Landlord at any time after the date six months before the
Contractual Expiry Date to fix and retain on any suitable (to both
Landlord and Tenant acting reasonably) part of the Premises a notice
for re-letting the Premises and not to remove or obscure such notice and
to permit all persons with the authority of the Landlord to view the
Premises at reasonable hours on prior appointment
Rights of entry
-----------------
3.43 To permit the Landlord and those authorised by it to enter the Premises
to:
3.43.1 ascertain whether the Tenant has complied with its
obligations in this Lease
3.43.2 assess the Full Cost of Reinstatement
3.43.3 take schedules of fixtures and chattels to be yielded up at
the end of the Term
3.43.4 provide the Services and carry out the other matters
referred to in Schedule 4
3.43.5 carry out repairs decorations alterations or other works to
neighbouring property
3.43.6 inspect repair renew connect to cleanse move relay or
construct existing or new Conduits or Plant in over or
under the Premises serving or to serve any neighbouring
property
3.43.7 comply with the obligations in any superior lease
3.43.8 do anything else reasonable which cannot otherwise be
conveniently done
And anyone exercising the right of entry shall:
---
3.43.9 (except in an emergency) do so only at reasonable times and
on reasonable notice
3.43.10 cause as little damage and inconvenience as reasonably
practicable and
3.43.11 make good any resulting damage to the Premises
To permit Landlord to remedy breach
----------------------------------------
3.44 To permit the Landlord and all those authorised by it to enter the
Premises without liability to the Tenant for any damage or inconvenience
Thereby created to remedy any breach of the Tenant's obligations in this
Lease specified by the Landlord by notice to the Tenant if:
3.44.1 one month thereafter the Tenant has not started or is not
continuing diligently to remedy the breach
3.44.2 two months thereafter the Tenant has not completed remedying
the breach or
3.44.3 in the Landlord's opinion the Tenant is unlikely to have
completed remedying the breach within two months thereafter or
such shorter period as the Landlord reasonably considers
necessary in the circumstances
AND the costs so incurred by the Landlord (including solicitors' and
---
surveyors' fees) shall be a liquidated debt and paid by the Tenant
to the Landlord on demand
Statutory obligations
----------------------
3.45 To comply with the present and future requirements of any statute
government department local or other public or competent authority or
court relating to the Premises or their use whether imposed on any owner
or occupier of them
3.46 To execute all works and provide and maintain all arrangements on or in
respect of the Premises or their use that are thereby required
3.47 Not to do or omit to do in the Premises or the Building anything as a
result of which the Landlord may under any statute have imposed upon it
.
or become liable to pay any penalty damages compensation costs charges
or expenses
Copies of notices
-------------------
3.48 Immediately after receipt to give to the Landlord full particulars of
any notice order proposal or recommendation given to or served on the
Tenant or any owner or occupier of the Premises affecting the Premises
or neighbouring property whether advertised or served directly on the
Tenant or any such owner or occupier or the original (or a copy) is
received by any of them from any other person
3.49 If so requested by the Landlord to produce any such notice order
proposal or recommendation and at the request and cost of the Landlord
to make or join in making such objections or representations in respect
of it as the Landlord requests
To pay charges under Planning Acts
---------------------------------------
3.50 To pay any charge or levy imposed under the Planning Acts during or
after the Term in respect of the carrying out or maintenance of any
operations at the Premises or the commencement or continuance of any
use of the Premises during the Term
No planning applications etc without consent
-------------------------------------------------
3.51 Not to serve any notice on nor to enter into any agreement with the
planning authority nor without the approval of the Landlord make any
application for permission under the Planning Acts
Copies of permissions
-----------------------
3.52 Immediately on receipt to give to the Landlord a copy of the grant
refusal or modification of any permission or other decision under the
Planning Acts
To obtain approval of permissions
-------------------------------------
3.53 Notwithstanding any consent or approval granted by the Landlord not to
make any alteration or addition to the Premises or any change of use
until the Landlord has approved every necessary permission such approval
not to be unreasonably withheld PROVIDED THAT the Landlord may refuse
-------------
approval inter alia on the grounds that any condition contained in it or
anything omitted from it or any other thing referred to in it would in
the opinion of the Landlord be (or be likely to be) prejudicial to the
Landlord's interest in the Premises during or after the end of the Term
To complete works before end of Term
------------------------------------------
3.54 To carry out and complete before the end of the Term:
3.54.1 any works to be carried out to the Premises by a date after
the end of the Term by a condition of any planning permission
granted for any development begun before the end of the Term
and
3.54.2 any development begun upon the Premises in respect of which
the Landlord shall or may be liable for any charge or levy
under the Planning Acts
Landlord's costs
-----------------
3.55 To pay to the Landlord on demand and indemnify the Landlord against all
costs fees damages charges and expenses (including without limitation
those of agents bailiffs and professional advisers) properly incurred
by the Landlord in connection with or incidental to:
3.55.1 any application by the Tenant or any person deriving title
under the Tenant in connection with the Premises or any term
of this Lease whether It proceeds or is granted refused or
granted subject to conditions
3.55.2 the preparation and service of a notice under Section 146 of
the Law of Property Act 1925 or any steps taken in or in
reasonable contemplation of proceedings under Sections 146 or
147 of that Act or otherwise requiring the Tenant to remedy
any breach of the Tenant's obligations in this Lease
(notwithstanding that forfeiture is avoided otherwise than by
relief granted by the court and whether or not any right of
forfeiture is waived by the Landlord or a notice served under
the said Section 146 is complied with by the Tenant)
3.55.3 any steps taken in or towards preparing or serving a schedule
of dilapidations whether during or after the end of the Term
and the negotiation and agreement of the amount payable by the
Tenant in respect of any items of disrepair or other breaches
of covenant which it has not remedied at the end of the Term
3.55.4 the recovery or attempted recovery of arrears of the Rents or
other sums due from the Tenant under this Lease or any other
breach by the Tenant of its obligations in this Lease
Indemnities
-----------
3.56 To indemnify the Landlord against any act omission or negligence of any
Visitor and any breach of the Tenant's obligations in this Lease by any
Visitor
Regulations
-----------
3.57 To comply with any written regulations from time to time made by the
Landlord relating to the management security occupation or use of the
Building or the Communal Garden
LANDLORD'S COVENANTS
---------------------
4. THE Landlord COVENANTS with the Tenant as follows:
--- ---------
Quiet enjoyment
----------------
4.1 That the Tenant shall peaceably hold and enjoy the Premises during the
Term without interruption or disturbance from or by the Landlord or any
Person lawfully claiming under or in trust for the Landlord
Compliance with superior lease
---------------------------------
4.2 To pay the rent and other payments payable pursuant to or reserved by
the superior lease dated 26 February 1999 made between (1) Grosvenor
(Belgravia) Estate and (2) the Landlord and (by way of indemnity only)
to comply with the essee's obligations in it insofar as they are not
the responsibility of the Tenant under this Lease
Services
--------
4.3 (Subject to payment by the Tenant of the Service Charge) throughout the
Term to use its reasonable endeavours to carry out the Services in
Accordance with the principles of good estate management PROVIDED
--------
THAT:
----
4.3.1 notwithstanding any implied or express obligation the
Landlord shallnot be liable to the Tenant for any failure
or interruption in any of the Services by reason of any
breakdown maintenance or repair works renewals or any cause
beyond its control
4.3.2 the Landlord may from time to time add to vary or discontinue
the Services so long as the addition variation or
discontinuation complies with the principles of good estate
management
Access to data hub
---------------------
4.4 That on written request from the Tenant the Landlord will at the sole
cost of the Tenant and subject to the provisions of Clause 3.23 hereof
carry out such works as are required to connect the data hub in the
Premises to the trunking from the data hub and main riser in the lower
ground floor of the Building
INSURANCE OBLIGATIONS
----------------------
5. THE Landlord and the Tenant AGREE with each other as follows:
--- -----
Landlord to effect insurance
-------------------------------
5.1 (Unless the insurance is vitiated and subject to such
reasonable or usual exclusions qualifications and excesses
as the insurers require) the Landlord shall insure and keep
insured the Building(excluding tenant's fixtures)and any items
which the Tenant covenants to insure)against risk of loss or
damage by the Insured Risks in the Full Cost of Reinstatement
and for Loss of Rent
Landlord to obtain consents for rebuilding
-----------------------------------------------
5.2 If the Building suffers Insured Damage the Landlord shall use its
reasonable endeavours to obtain all planning permissions or other
permits and consents required under the Planning Acts or other statutes
(if any) ("the Permissions") to enable it to rebuild the parts of the
Building which have suffered the Insured Damage so as to make good the
Insured Damage PROVIDED THAT:
-------------
5.2.1 if the insurance against any Insured Damage (or any damage
or destruction which would be Insured Damage but for such
vitiation) is vitiated the Landlord's obligations in Clauses
5.2 and 5.3 shall not apply in relation to that damage or
destruction unless and until the Tenant has within six months
of the occurrence of the damage or destruction paid to the
Landlord in full any sums due under Clause 5.5.2 as a result
of the vitiation
5.2.2 all sums received in respect of such insurance shall belong
beneficially solely to the Landlord
Landlord to reinstate (other than minor damage)
-----------------------------------------------------
5.3 If the Building suffers Insured Damage the Landlord shall as soon as
reasonably practicable ( or where required as soon as reasonably
practicable after the Permissions have been obtained) rebuild the parts
of the Building which have suffered the Insured Damage so as to make
good the Insured Damage PROVIDED THAT the Landlord shall not be liable
--------------
to rebuild under this sub-clause if and for so long as such rebuilding
is prevented because:
5.3.1 the Landlord has failed despite using its reasonable
endeavours to obtain all the Permissions
5.3.2 any of the Permissions is granted subject to a lawful
condition which it is unreasonable to expect or impossible for
the Landlord to comply with
5.3.3 some defect or deficiency in the site on which it is to take
place makes rebuilding impossible or incapable of being
undertaken at a reasonable cost
5.3.4 of war act of God governmental action strike lockout or
5.3.5 of any other circumstances beyond the control of the Landlord
Cesser of rent
----------------
5.4 If the Building suffers Insured Damage so as to render the whole or any
part of the Premises or the means of access thereto in the Building
unfit for occupation or use and the insurance against such Insured
Damage has not been vitiated the whole or (according to the nature and
extent of the Insured Damage) a fair proportion of the Rents shall be
immediately suspended either until the parts of the Building which have
suffered the Insured Damage have been rebuilt so that the Premises and
the means of access thereto in the Building are no longer unfit for
occupation or use as a result of the Insured Damage or until the end of
three years (or if longer of the period for which insurance for Loss of
Rent against the Insured Damage has been effected under Clause 5.1) from
The Insured Damage whichever first occurs PROVIDED THAT if the Building
-------------
(or any part thereof) has not been reinstated within three years
following the Insured Damage so that the Premises are fit for
occupation and use then either party may determine this Lease (within
six months from the expiry of such three year period) by giving to the
other notice in writing whereupon this Lease shall cease and determine
absolutely but without prejudice to the rights of either party against
the other in respect of any antecedent breach of covenant
Tenant's insurance obligations
--------------------------------
5.5 The Tenant shall:
Notice of damage
------------------
5.5.1 give notice to the Landlord immediately if the Premises are
destroyed or damaged by any of the Insured Risks or if any
event occurs which might affect any insurance policy relating
to the Premises
Payment after vitiation
-------------------------
5.5.2 pay to the Landlord on demand the insurance monies (other than
for Loss of Rent) which would have been payable but for such
insurance being vitiated if Landlord's Liability Insurance or
similar insurance for neighbouring property of the Landlord is
vitiated or if the Premises or the Building or any
neighbouring property of the Landlord are damaged or destroyed
by any of the Insured Risks and the insurance against such
damage or destruction is vitiated
Tenant's insurance monies
---------------------------
5.5.3 apply all monies to which the Tenant is entitled by virtue of
any insurance of the Premises in making good the loss or
damage in respect of which they are payable
No dangerous substances
-------------------------
5.5.4 not without the consent of the Landlord bring or do on the
Premises or the Building anything of a dangerous combustible
inflammable or explosive nature
Not to vitiate
----------------
5.5.5 not do or omit to do on the Premises or the Building anything
which may result in an increase in the premium for the
insurance of the Premises or the Building or any neighbouring
property of the Landlord (unless the Tenant (with the approval
of the Landlord such approval not to be unreasonably withheld)
has paid such increased premium) or which may vitiate any
insurance of the Premises the Building or any neighbouring
property of the Landlord
Insurer's requirements
-----------------------
5.5.6 comply with the requirements and recommendations from time to
time of the insurers of the Premises and the Building
Tenant's third party liabilities
-----------------------------------
5.5.7 insure and keep insured the Premises against the Tenant's
third party public and occupiers' liability risks in a sum
reasonably to be approved by the Landlord such approval not to
be unreasonably withheld or delayed
PROVISOS
--------
6. IT IS FURTHER AGREED as follows:
-----------------------
Forfeiture
----------
6.1 Whenever:
6.1.1 the Rents are in whole or part unpaid fourteen days
after becoming payable whether formally demanded or
not
6.1.2 there is a breach of any of the Tenant's obligations
in this Lease
6.1.3 the Tenant (which expression includes in Clauses
6.1.3 to 6.1.7 any person in whom this Lease is
then vested) becomes bankrupt or is the subject of
an interim order under the Insolvency Act 1986
6.1.4 the Tenant goes into voluntary or compulsory
liquidation (except solely for the purpose of a bona
fide solvent amalgamation or reconstruction) or is
the subject of a winding-up order or a petition for
an administration order or is otherwise dissolved
wound up or ceases to exist
6.1.5 a receiver or a receiver and manager or an
administrative receiver is appointed in respect of
the whole or any part of the Tenant's undertaking or
assets
6.1.6 the Tenant enters into any arrangement or composition
for the benefit of or with its creditors or
6.1.7 the Tenant has any distress or execution levied on
its goods from the Premises
Then the Landlord may re-enter the Premises or any part of them in the
----
name of the whole and the Term will determine absolutely but without
prejudice to the rights of the Landlord in respect of any prior breach
of the Tenant's obligations in this Lease or any surety for them
No implied rights
-------------------
6.2 Save for the rights expressly set out in Schedule 2 the Tenant is not
and shall not be entitled by implication of law or otherwise to any
right or privilege over or against the remainder of the Building or
any neighbouring property which belongs to the Landlord now or in the
future
No restrictions on adjoining property
-----------------------------------------
6.3 Nothing contained or implied in this Lease shall impose or be deemed to
impose any restriction on the use of any land or building (other than
the Premises) or give the Tenant the benefit of or prevent the
release or modification of any obligation entered into by any purchaser
lessee or occupier of any neighbouring property
Exclusion of liability
------------------------
6.4 Except insofar as liability may be covered by insurance effected by the
Landlord in force when the liability is incurred the Landlord shall
not be responsible to the Tenant or anyone at the Premises or the
Building for any accident happening or injury suffered or for any
Damage to or loss of any chattel sustained in the Premises or the
Building whether caused by negligence or otherwise
Compensation
------------
6.5 Save to the extent prohibited by any rule of law neither the Tenant nor
any undertenant shall be entitled on quitting the whole or any part
of the Premises to claim any compensation from the Landlord under the
1954 Act or any other present or future statute and the Tenant shall
indemnify the Landlord against any claim for such compensation
Service of notices
--------------------
6.6 Any notice served under this Lease:
6.6.1 shall be in writing
6.6.2 may be addressed to "the Landlord" or "the Tenant" by that
designation without naming the person who is the Landlord or
the Tenant
6.6.3 shall be validly served if left at the addressee's last known
place of abode or business in the United Kingdom
6.6.4 shall (in the case of the Tenant)be validly served if attached
to or left at the Premises and
6.6.5 shall be validly served on the third day (excluding Saturdays
Sundays and statutory bank holidays) after being posted if it
Is posted to the addressee's last known place of abode or
business in the United Kingdom in a registered letter or by
recorded delivery service unless returned through the post
office undelivered
Alterations to the Communal Garden
--------------------------------------
6.7 The Landlord may for any reason and during such time as the Landlord
thinks fit change the layout planning or extent available to the Tenant
of the Communal Garden and or restrict access to or close the whole or
any part of it
Representations
---------------
6.8 The Tenant acknowledges that it has not entered into this Lease in
reliance wholly or partly on any written oral or implied representation
by or on behalf of the Landlord other than the Landlord's solicitor's
replies to the Tenant's solicitor's written enquiries or contained in
correspondence from the Landlord's solicitors
6.9 Clause 6.8 only excludes or restricts any liability or remedy for
misrepresentation to the extent that (notwithstanding the exclusion or
restriction) it would be a fair and reasonable term to include in this
Lease having regard to the circumstances which at the date of this Lease
were or ought reasonably to have been known to or in the contemplation
of the parties hereto
Disputes
--------
6.10 All cases of dispute between the Tenant or any undertenant of the
Premises and the occupiers of any neighbouring property or the tenants
Or occupiers of any other part of the Building in connection with
the use or occupation of the Premises shall be submitted to the decision
of a surveyor appointed by the Landlord acting as expert and not
arbitrator whose decision shall be final and binding on matters of fact
on all the parties to the dispute
Exclusion of third party rights
-----------------------------------
6.11 It is not intended that any term of this Lease is enforceable by a
third party under Section 1 of the Contracts (Rights of Third Parties)
Act 1999
Sums due to Landlord treated as rent
------------------------------------------
6.12 Any sum due from the Tenant to the Landlord under this Lease shall be
additional rent hereby reserved and paid by the Tenant (save where
otherwise provided) on demand and shall be recoverable by action or
distress and the word "Rents" shall be construed accordingly
Stamp duty certificate
------------------------
6.13 It is hereby certified that there is no agreement for lease to which
this Lease gives effect
Governing law and jurisdiction
---------------------------------
6.14.1 This Lease shall be governed by and construed in accordance with the
laws of England and Wales
6.14.2 The parties hereto (which expression in this Clause includes their
respective successors in title and in the case of an individual his
personal representatives) hereby confer jurisdiction on the High Court
of Justice of England and Wales (hereinafter called "the High Court")
to settle all disputes which may arise in relation to this Lease or the
Premises(other than any which under the terms hereof are to be submitted
For determination to arbitration or to an independent expert or other
person but including where possible any appeal from the determination
of any dispute so submitted)
6.14.3 The Tenant hereby agrees that service of notices and other documents
(including originating process) relating to this or the Premises may be
validly effected at 63 Queen Victoria Street London EC4N 4ST or such
other address in England and Wales as it from time to time notifies in
writing to the other party hereto
RENT REVIEW
------------
7. THE Basic Rent for the time being payable under this Lease shall be
---
reviewed as follows:
Frequency of review
---------------------
7.1 For the purposes of this Clause "the Review Date" means the
day after the date of expiry of the fifth year of the Term
Upwards only reviews
----------------------
7.2 From and including each Review Date the Basic Rent shall be
whichever is the greater of the amount of the Basic Rent
payable during the twelve months immediately preceding that
Review Date(ignoring for this purpose but without prejudice to
any suspension under Clause 5) and the open market rent for
the Premises at that Review Date
Basis of valuation
--------------------
7.3 (Subject to Clause 7.4) the open market rent for the Premises
at each Review Date shall be the amount agreed by the Landlord
and the Tenant (or if they fail to agree determined in
accordance with Clause 7.5) to be the rent per year at which
the Premises might reasonably be expected to be let in the
open market on that Review Date:
7.3.1 as a whole
7.3.2 by a willing lessor to a willing lessee
7.3.3 with vacant possession
7.3.4 without taking any fine or premium
7.3.5 for a term of ten years starting on that Review Date
7.3.6 on the terms of this Lease including this Clause
other than as to the amount of the Basic Rent and
the rent-free period (if any) applicable at the
start of the Term
ON THE ASSUMPTIONS that at that Review Date:
--------------------
7.3.7 the Landlord (save for material breach) and the
Tenant have fully complied with their obligations in
this Lease
7.3.8 the Premises and the Building and all other necessary
services and facilities are in good and ubstantial
repair and condition and fit and available for
immediate beneficial occupation and use
7.3.9 no work has been carried out and nothing has occurred
on or directly relating to the Premises which has
diminished the rental value of the Premises
7.3.10 if the Premises or the Building have been damaged or
destroyed they have been fully rebuilt
7.3.11 the Premises may be lawfully used for any of the
purposes permitted by this Lease as varied or extended
by any licence pursuant to this Lease
BUT DISREGARDING:
-----------------
7.3.12 the fact that the Tenant any undertenants or their
respective predecessors in title shall have been in
occupation of the Premises
7.3.13 any goodwill that shall have become attached to the
Premises from the carrying on of the business of the
Tenant or any undertenants or their respective
predecessors in such business
7.3.14 any effect on rent of the Premises attributable to
the existence at such Review Date of any improvement
to the Premises lawfully carried out by the Tenant
any undertenants or their respective predecessors in
title with the consent of the Landlord ( where
necessary) under the terms of this Lease otherwise
than in pursuance of any obligation to the Landlord
and/or their immediate landlord
7.3.15 the fact that the Premises or the Building or any
necessary facilities or services shall be defective
in any way
Treatment of rent free periods
----------------------------------
7.4 The open market rent for the Premises shall be ascertained without
making any discount reduction or allowance to reflect (or compensate the
Tenant or the hypothetical tenant for the absence of) any rent-free
period or concessionary rent period during which fitting-out works would
be carried out which it might then be the practice in open market
lettings for a landlord to make so that the open market rent for the
Premises shall be that which would be payable after the expiry of any
such rent-free or concessionary rent period
Method of determination
-------------------------
7.5 If the Landlord and the Tenant fail to agree the open market rent for
the Premises by a date three months before any Review Date then:
7.5.1 the determination of the open market rent for the Premises
at that Review Date may be referred to an independent
chartered surveyor ("the Surveyor") with experience in the
letting of office premises in Central London
7.5.2 the Surveyor shall be appointed by the Landlord and the Tenant
jointly and (if they fail to agree) shall be nominated at the
request of the Landlord or the Tenant by or on behalf of the
President (or Senior Officer) ("the President") for the time
being of The Royal Institution of Chartered Surveyors
7.5.3 if the Surveyor dies delays or becomes unwilling unfit or
incapable of acting or if for any other reason the President
thinks fit he may on the application of the Landlord or the
Tenant by writing discharge the Surveyor and appoint another in
his place
7.5.4 the costs and expenses of the Surveyor (including the costs of
his appointment) shall be borne as he shall direct or in default
of direction by the Tenant
7.5.5 the Surveyor shall act as an arbitrator or (at the option of the
Landlord) independent expert
7.5.6 if the Surveyor is an arbitrator (subject to Clause 7.5.3) the
arbitration shall be conducted in accordance with the
Arbitration Act 1996
7.5.7 if the Surveyor is an independent expert:
7.5.7.1 his decision shall be final and binding and
7.5.7.2 he shall afford the Landlord and the Tenant an
opportunity to make representations to him and to
comment to him on the other's representations
Interim arrangements
---------------------
7.6 If the open market rent for the Premises payable from any Review Date
has not been ascertained in accordance with this Clause before that
Review Date then:
7.6.1 the Tenant shall until the first quarter day after the date
on which it is ascertained continue to pay the Basic Rent at
the rate applicable but for the review due at that Review Date
7.6.2 within seven days after the date on which it is ascertained
the Tenant shall pay to the Landlord as additional Basic Rent:
7.6.2.1 the amount (if any) of the shortfall between
(a) the amount of the Basic Rent so payable by the
Tenant down to such quarter day and (b) the amount
Which would have been payable if it had been
Ascertained before that Review Date and
7.6.2.2 interest at 4% below the Prescribed Rate on each
further payment of Basic Rent which would have been
payable if it had been ascertained before that
Review Date for the period from when such payment
would have been payable until due for payment under
this sub-clause
Time not of the essence
---------------------------
7.7 In respect of the time limits mentioned in this Clause time shall not be
or be deemed to be of the essence
Statutory restrictions
-----------------------
7.8 If at any Review Date there is in force a statute or other instrument
which prevents restricts or modifies the Landlord's rights to review the
Basic Rent in accordance with this Lease and/or to recover any increase
in the Basic Rent then (if such prevention restriction or modification
is removed relaxed or modified but without prejudice to its rights
(if any) to recover any Basic Rent the payment of which has only been
deferred by law) the Landlord may by giving not less ,than one month's
nor more than three months' notice in writing to the Tenant at any time
within six months of it being removed relaxed or modified proceed with
any review of the Basic Rent which was prevented or further review the
Basic Rent in respect of any review where the Landlord's right was
restricted or modified and the date of expiry of such notice shall be
deemed to be a Review Date (provided that nothing in this sub-clause
shall vary any subsequent Review Dates) and to recover any increase
in Basic Rent thereby resulting with effect from the earliest date
permitted by law
Memoranda
---------
7.9 Whenever the Basic Rent has been agreed or determined in accordance with
this Clause memoranda of it shall be signed by or on behalf of the
Landlord and the Tenant and attached to this Lease and its counterpart
IN WITNESS whereof this Lease has been duly executed by the parties hereto and
-----------
is delivered as a Deed the day and year first before written
SCHEDULE 1
----------
(Particulars of the Premises)
The Premises are shown for identification purposes only coloured pink on the
attached plan and exclude all structural and external parts and any Conduits and
Plant within the Premises which do not exclusively serve the Premises and
subject thereto include:
1. All additions and alterations to the Premises
2. All fixtures from time to time annexed to the Premises
3. Any interior screeding plaster work wall and ceiling finishes (including
any false ceilings and the airspace above the false ceilings) and all
ornamental or architectural features
4. All non-structural walls and partitioning and where such walls and or
partitioning abut any other part of the Building which is suitable for
letting by the Landlord for independent occupation one half (severed
vertically) of each of such walls or partitioning
5. The boards and screeds of floors and any floor coverings in the Premises
now or in the future provided by or at the cost of the Landlord
6. The glass and inside surfaces of the windows window frames doors and
door frames in the walls enclosing or within the Premises
7. All Conduits where not part of Plant within and exclusively serving the
Premises
8. All Plant within and exclusively serving the Premises
SCHEDULE 2
----------
(Rights granted)
Conduits
--------
1. (So far as the Landlord can grant them and subject to temporary
interruption for repair alteration or replacement) the passage of water
soil gas electricity and other services to and from the Premises in
and through the Conduits which now serve the Premises and are in or
over other parts of the Building
Common Parts
-------------
2. (Subject to any regulations from time to time made by the Landlord) the
right of access to and egress from the Premises on foot throughout the
Common Parts
Communal Garden
----------------
3. To use the Communal Garden for walking and for escape from the rear of
the Building
Support
-------
4. Support shelter and protection for the Premises from other parts of the
Building
Toilets
-------
5. The right to use the toilet facilities in the Building
SCHEDULE 3
----------
(Exceptions and reservations)
Conduits
--------
1. The passage of water soil gas electricity and other services to and from
all neighbouring property whether belonging to the Landlord or not in
and through the Conduits which are now or hereafter in or over the
Premises
Easements
---------
2. All other easements or other rights in the nature of easements or
quasi-easements now enjoyed by any neighbouring property of the
Landlord over the Premises
Support
-------
3. Support shelter and protection from the Premises for adjoining buildings
or structures now or hereafter erected against or over the Premises
Emergency access
-----------------
4. In case of emergency to pass through the Premises in accordance with the
requirements of any competent authority
Entry
-----
5. To enter the Premises for the purposes mentioned in this Lease
To build
---------
6. To build or rebuild or alter any buildings on any neighbouring land in
any manner whatsoever notwithstanding that as a result there is a
diminution in the present or future access of light or air to the
Premises which it is hereby agreed is and shall be enjoyed with the
consent of the Landlord or other the owner or occupier of such land and
not as of right
SCHEDULE 4
----------
(The Service Charge)
PART I
------
(Definitions)
In this Schedule the following expressions have the meanings set against them:
"Account Day" the 31st day of December in each year of the Term (or such
other day as the Landlord from time to time determines)
"Accounting the periods:
Period"
(1) from and including the start of the Term (or if earlier
the date when the Tenant first had or was entitled to have
access to the Premises) to and including the first Account Day
(2) from and including the day after each Account Day in the
Term (except the last one) until and including the next Account
Day
(3) from but excluding the last Account Day in the Term to
the end of the Term
"the Service the sums from time to time calculated in accordance with and
Charge" payable by the Tenant as set out in Part II of this Schedule
"the Service the aggregate of the total cost incurred by the Landlord in or
Charge incidental to providing the Services and of the total
Expenditure" expenses incurred by the Landlord of the kind set out in
Part IV of this Schedule as calculated in Part II of this
Schedule
PART II
-------
(Calculation and payment)
Proportion
----------
1. The Service Charge shall in relation to any Accounting Period during the
Term be 37% of the Service Charge Expenditure incurred in such
Accounting Period
Annual Estimate
----------------
2. Save in respect of the first Accounting Period the Landlord shall before
or as soon as practicable after each Account Day prepare a certificate
estimating the Service Charge Expenditure for the Accounting Period
starting on the day after that Account Day and stating the sum
which shall be the provisional Service Charge payable by the Tenant
for that Accounting Period
Payment on account
--------------------
3. The Tenant shall pay the provisional Service Charge sum ascertained in
accordance with paragraph 2 above by equal quarterly payments on the
usual quarter days in that Accounting Period
Payment in first year
------------------------
4. The Tenant shall pay on the date of this Lease (or if later within seven
days of demand) and on each of the following Quarter Days in the
first Accounting Period such sum as the Landlord specifies and the
aggregate of such sums shall be the provisional Service Charge for
that Accounting Period
Payment if no estimate
-------------------------
5. If the Tenant has not been given notice of the Landlord's estimate of
the provisional Service Charge for an Accounting Period the Tenant
shall on the relevant Quarter Days pay an amount equal to the last
quarterly payment of Service Charge in the preceding Accounting Period
and any requisite adjustment shall be made to the first quarterly
payment due after such notice is given
Additional payments on account
---------------------------------
6. If during an Accounting Period the Landlord incurs Service Charge
Expenditure which was not anticipated in the estimate provided under
paragraph 2 above for that Accounting Period or the payment due under
paragraph 4 above for the first Accounting Period then the Landlord may
require the Tenant to repay the percentage of it referred to in
paragraph 1 above within fourteen days of written demand and such
Service Charge Expenditure so demanded shall not be included in the
Statement or payments for that Accounting Period referred to in
paragraphs 7 and 8 below
Final statement
----------------
7. As soon as practicable after each Accounting Period the Landlord shall
furnish the Tenant with a statement (which save for the correction
of any manifest error in it shall be conclusive and binding on the
Tenant) of the Service Charge Expenditure incurred in and the Service
Charge payable by the Tenant for that Accounting Period
Balancing payment
------------------
8. If the Service Charge for any Accounting Period exceeds the provisional
Service Charge payable under paragraph 3 or paragraph 4 for that
Accounting Period the excess shall be due to the Landlord on demand or
if it is less the overpayment shall be credited to the Tenant against
the next quarterly payment of the Service Charge (or if necessary
subsequent payments)
No dispute
-----------
9. Without prejudice to the preceding provisions of this Part of this
Schedule the Tenant shall not question any item of Service Charge
Expenditure on the ground that it need not have been incurred in a
Particular Accounting Period or could have been provided more
economically or on grounds relating to the length of the residue of the
Term for the time being if provided at proper cost
Inspection of vouchers
------------------------
10. The Tenant may once in each Accounting Period at its own expense
inspect the vouchers supporting the statement referred to in paragraph
7 above at such reasonable time and place as the Landlord specifies
Position after end of Term
------------------------------
11. The provisions of this Schedule shall continue to apply notwithstanding
the end of the Term but only in respect of the period before its end
and any overpayment made by the Tenant in relation to the last
Accounting Period and any sums remaining in any sinking fund or reserve
fund shall be repaid to the Tenant within twenty-one days of the
Landlord sending a certificate of the Service Charge and Service Charge
Expenditure for the final Accounting Period
Variations to Service Charge
-------------------------------
12. If at any time during the Term the total property enjoying or capable or
enjoying the benefit of any of the Services is increased or decreased
on a permanent basis or the benefit of any of the Services is extended
on a like basis to any neighbouring property the Service Charge
shall be varied with effect from the Account Day following such event
in such a manner as the Landlord determines is fair and reasonable in
the light of the event in question except that nothing contained in
this Lease shall imply an obligation on the Landlord to provide the
Services to any neighbouring property
Treatment of payments due on Quarter Days
-----------------------------------------------
13. If any Accounting Period ends on the last day of March June September or
December and if the Landlord so requires the payment on account of the
Service Charge due on the preceding Quarter Day shall be deemed instead
paid on account of the Service Charge for the following Accounting
Period and shall be calculated by the Landlord by reference to its
Estimate of the Service Charge Expenditure for such following
Accounting Period
Alternative method
-------------------
14. The Landlord may elect that for so long as it elects the above
provisions shall not apply in relation to any particular costs
mentioned in paragraph 10 of Part IV of Schedule 4 and in relation to
the costs subject to the election the Tenant shall pay them to the
Landlord within 14 days of written demand
PART III
--------
(Services)
Repair
------
1. Maintaining repairing renewing (for the purpose of repairing) rebuilding
(for the purposes of repair only) decorating cleansing and treating
appropriately the Common Parts and the foundations roofs external walls
and other structural and external parts of the Building including the
repair and external decoration of the frames of the exterior windows
(but not the glass in them)
Exterior
--------
2. Landscaping and lighting the external Common Parts
Internal heat light and water
---------------------------------
3. Heating lighting and furnishing the internal Common Parts and providing
an adequate supply of hot water and cold water thereto
Plant
-----
4. Maintaining repairing renewing and replacing all Plant in the Building
other than that for which the Tenant or any other tenant is responsible
and insuring it (save insofar as insured by the Tenant or any
other tenant)
Conduits
--------
5. Maintaining repairing renewing and replacing all services Conduits and
appliances that serve the Building other than those belonging to the
relevant supply authorities or for which the Tenant or any other tenant
is responsible
Common structures
------------------
6. Maintaining repairing renewing cleansing and lighting all ways services
or structures used in common with any adjoining or neighbouring
premises
Security
--------
7. Providing such security measures as the Landlord from time to time
reasonably deems to be expedient or necessary
Refuse
------
8. Providing facilities for the disposal of refuse from the Building
PART IV
-------
(Expenses)
Fees
----
1. The fees and disbursements of:
1.1 any managing agents accountants engineers surveyors solicitors
architects or other advisers employed or retained by the
Landlord for (or in connection with) any of the provisions of this
Schedule and the provision of the Services (which expression in
this Part of this Schedule includes any other services and matters
referred to in such Part)
1.2 any person providing caretaking or security arrangements and
services for the Building
1.3 the Landlord on a fair and reasonable basis if the management and
supervision of the Building is carried out by the Landlord
Staff
-----
2. The cost of employing such staff as the Landlord in its absolute
discretion from time to time deems necessary for the performance of the
Services and all other incidental expenditure in relation to such
employment including but without limiting the foregoing:
2.1 insurance pension and welfare contribution
2.2 transport facilities and benefits in kind
2.3 the provision of uniforms and working clothing
2.4 the provision of vehicles tools appliances cleaning and other
materials fixtures and other equipment for the proper performance
of their duties
2.5 the provision (including related Outgoings) of office and
other accommodation in the Building
Outgoings
---------
3. All Outgoings which relate to the Common Parts or the Building as a
whole on its own or with other property but not any parts of the
Building which are or are intended to be let save for any such parts
occupied as office and other accommodation connected to the provision
of the Services
Electricity gas etc
---------------------
4. The cost of the supply of electricity gas oil or other fuels telephone
and public or statutory utilities in respect of the provision of any of
the Services and in respect of the Common Parts and the cost of running
all Plant other than that for which the Tenant or any other tenant is
responsible and the cost of water supplied to the Building for which no
tenant is responsible and the cost of supplying toilet requisites to
the lavatory accommodation in the Building
Statutory requirements
-----------------------
5. The cost of taking all steps from time to time reasonably deemed
desirable or expedient by the Landlord and for the benefit of all
occupiers of the Building for complying with or in connection with or
making representations against or otherwise contesting the incidence of
the provisions of any statutes concerning town planning public health
highways streets drainage safety fire precautions fire regulations or
other matters relating to or alleged to relate to the Building for
which any tenant is not directly and exclusively liable
Nuisance
--------
6. The cost of the Landlord of abating a nuisance in respect of the
Building insofar as not the liability of any individual tenant
Leasing
-------
7. The costs of leasing any item for the purpose of providing any of the
Services
Interest
--------
8. Any interest and fees in respect of money borrowed by the Landlord to
finance the obligations of the Landlord to provide the Services and
if the Landlord provides monies out of his own resources interest
on the monies provided at a rate equal to 2% per annum below the
Prescribed Rate
Financial reserves
-------------------
9. Such provision (if any) as the Landlord from time to time determines
necessary for a sinking fund and reserve fund with a view to meeting
future costs
Common items and Garden Charge
----------------------------------
10. A fair proportion (to be determined by the Landlord) of the cost of
maintaining keeping in good order repairing renewing lighting
cleansing and resurfacing as appropriate:
10.1 all party walls boundary structures Conduits and other things
(whether or not of a similar nature) the use of which is common
to the Building and any other property and
10.2 the Communal Garden and the iron railings or other fences
gates enclosing it (including the plinths to which they are
fixed) and the walks lawns and shrubberies thereof and any other
embellishments now or hereafter belonging thereto
Other services
---------------
11. (Without limiting or being limited by reference to the foregoing) the
cost of any other service insurance or matter which the Landlord from
time to time thinks expedient or necessary for the benefit of the
tenants of the Building
SCHEDULE 5
----------
(Alienation conditions)
PART I
------
(Requirements for an assignment)
Application
-----------
1. This Part applies for the purposes of Section 19(1A) of the Landlord and
Tenant Act 1927
Authorised guarantee agreement
--------------------------------
2. Before any assignment of the Premises the assignor shall give an
authorised guarantee agreement in accordance with the Landlord and
Tenant (Covenants) Act 1995 to the Landlord of the performance by the
assignee of the Tenant's obligations in this Lease in such form as
the Landlord reasonably requires but in any event containing provisions
preventing the guarantee from being vitiated by:
2.1 any neglect or forbearance of the Landlord
2.2 any time or indulgence given by the Landlord
2.3 any variation of this Lease or the variation of or entry into any
other contract by the Landlord and the Tenant and
2.4 the release of any security or guarantee held in relation to
such obligations
Guarantor of assignor to join in guarantee
------------------------------------------------
3. If the Landlord reasonably so requires the Tenant shall procure that
before any assignment of the Premises any person who is then a
guarantor of the Tenant's obligations in this Lease (other than a
person who shall have previously been the Tenant and its guarantor)
gives a guarantee of the guarantee given in relation to that assignment
pursuant to paragraph 2 in such form as the Landlord reasonably requires
but in any event containing provisions equivalent to those specified in
paragraph 2
Disregard of guarantees
-------------------------
4. In deciding whether to approve a proposed assignment the Landlord may
disregard:
4.1 its rights under paragraphs 2 and 3 above and Section 16 of the
Landlord and Tenant (Covenants) Act 1995 and
4.2 the fact that the assignor and/or its guarantor would or might
give a guarantee of the assignee's obligations to the Landlord
No intra-group assignments
----------------------------
5. The Premises shall not be assigned to a person who at the date of the
assignment is a member of the same group as the assignor or any
guarantor of the assignor's obligations in this Lease within the
meaning of Section 42 of the 1954 Act unless following such assignment
in the Landlord's reasonable opinion (and on the assumption that the
Landlord wished to sell its interest in the Premises the day after such
assignment) the value of the Landlord's reversionary interest in the
Premises would not be reduced as a result of such assignment
No arrears
-----------
6. The Tenant shall not assign the Premises unless it has paid all Rents
and other sums which have fallen due under this Lease before the
date of the assignment
PART II
-------
(General requirements)
Prior approval to permitted dealings
----------------------------------------
1. (Subject to the other provisions of this Schedule and Clause 3.21) the
Tenant shall not without the approval of the Landlord (such approval not
to be unreasonably withheld or delayed) assign charge or underlet the
whole of the Premises
Group sharing
--------------
2. (Notwithstanding the foregoing or any covenant entered into by an
undertenant pursuant to this Lease) the Tenant or any undertenant
may share occupation of the whole or any part of the Premises with
a person who is a member of the same group as the Tenant or the
undertenant as the case may be (within the meaning of Section 42 of
the 1954 Act) for so long as both the Tenant or undertenant and the
other person remain members of that group subject to:
2.1 no landlord and tenant relationship or other interest in the
Premises at law or in equity being thereby created and
2.2 the Tenant notifying the Landlord immediately of the identity of
the other person
Underlettings of part
-----------------------
3. (Notwithstanding references in this Part and Clause 3.22 to underleases
of part of the Premises) there shall be no underletting of any part (as
distinct from the whole) of the Premises other than a Permitted Part
together with and excepting and reserving such rights as are
reasonably necessary in the circumstances and the Premises shall not
be occupied in more than two units of occupation (of which (for so long
as there is such an underletting) one unit of occupation shall at all
times be in the name of the Tenant)
No premiums for underleases
------------------------------
4. No underlease shall be granted at a fine or premium nor other than at
the then full open market rent for the premises underlet such rent to
be payable and to be subject to review on the same days and in the
same manner as under this Lease
Undertenants' direct covenants
--------------------------------
5. Before the grant or assignment of any underlease the undertenant or
assignee shall covenant with the Landlord:
5.1 to comply with the Tenant's obligations in this Lease (save
as to payment of rent) until the underlease is assigned by an
assignment which is not an excluded assignment (in the case of an
underletting of part of the Premises insofar only as they relate
to the premises thereby demised) and
5.2 not to assign charge underlet hold on trust for another or
otherwise part with or share possession or occupation of or
suffer any other person to occupy the whole or any part of the
premises underlet save with the approval of the Landlord (such
approval not to be unreasonably withheld or delayed) by way of an
assignment of the whole thereof complying with the provisions of
this Schedule mutatis mutandis to a person who has entered
into the covenants required by this paragraph 5
Terms of underleases
----------------------
6. Any underlease of the Premises shall be granted on the same terms as
this Lease (including the reservation of rents equivalent to the
Insurance Rent and Service Charge) modified to the same effect as the
alienation covenants to be given to the Landlord pursuant to paragraph
5
Exclusion of security of tenure
-----------------------------------
7. Before completion of any underlease of the Premises and the occupation
by any proposed undertenant of the premises to be demised thereby a
valid court order shall be made authorising the exclusion of the
provisions of Sections 24 to 28 (inclusive) of the 1954 Act in relation
to the tenancy to be created by such underlease and a declaration to
that effect shall be included in it and a certified copy of the order
and the application for it shall be supplied to the Landlord
Definition of "Permitted Part"
---------------------------------
8. In this Schedule "Permitted Part" means the entirety of one floor of the
Premises (other than common parts and structural parts of the Premises)
(THE COMMON SEAL of GROSVENOR
----------------- ---------
(WEST END PROPERTIES was hereunto
---------------------
(affixed in the presence of:
Director
Director
Terms of underleases
----------------------
6. Any underlease of the Premises shall be granted on the same terms as
this Lease (including the reservation of rents equivalent to the
Insurance Rent and Service Charge) modified to the same effect as the
alienation covenants to be given to the Landlord pursuant to paragraph
5
Exclusion of security of tenure
-----------------------------------
7. Before completion of any underlease of the Premises and the occupation
by any proposed undertenant of the premises to be demised thereby a
valid court order shall be made authorising the exclusion of the
provisions of Sections 24 to 28 (inclusive) of the 1954 Act in
relation to the tenancy to be created by such underlease and a
declaration to that effect shall be included in it and a certified copy
of the order and the application for it shall be supplied to the
Landlord
Definition of "Permitted Part"
---------------------------------
8. In this Schedule "Permitted Part" means the entirety of one floor of the
Premises (other than common parts and structural parts of the
Premises)
EXECUTED as a Deed by CANARGO )
-------- -------
ENERGY CORPORATION by the )
-------------------
signature of a director and its secretary )
or two directors )
/s/Russ Hammond
Russ Hammond
Director
/s/Nils Trulsvik
Nils Trulsvik
Director
DATED September 8, 2000
------------------------------------
-----------------------------------------------
(1) CANARGO ENERGY CORPORATION
(2) GROSVENOR WEST END PROPERTIES
-----------------------------------------------
-----------------------------------------------
RENT DEPOSIT DEED
relating to Lease of first and second floors 148/150
Buckingham Palace Road London SW1
-----------------------------------------------
DATED September 8, 2000
--------------------------------------------
-----------------------------------------------------------
(1) CANARGO ENERGY CORPORATION
(2) GROSVENOR WEST END PROPERTIES
-----------------------------------------------------------
-----------------------------------------------------------
Counterpart/
RENT DEPOSIT DEED
relating to Lease of first and second floors 148/150
Buckingham Palace Road London SW1
-----------------------------------------------------------
INDEX
-----
INTERPRETATION...........................................1
PAYMENT INTO ACCOUNT.....................................3
OPERATION OF THE ACCOUNT.................................3
Withdrawal only by Landlord...........................3
Interest..............................................3
Withdrawal for non-payment............................4
Insolvency............................................4
Forfeiture and disclaimer.............................5
Notification of withdrawal............................5
No prejudice to other rights..........................5
Tenant to make up withdrawals.........................6
Rent reviews..........................................6
Value Added Tax.......................................6
RELEASE..................................................7
Date for release......................................7
Definition of Tenant in Clause 4.1.3..................7
No release during subsisting breach...................8
NON-VITIATION............................................8
ASSIGNMENT OF REVERSION..................................9
ASSIGNMENT BY TENANT.....................................9
CHARGE...................................................9
VARIATION OF LEASE......................................10
GOVERNING LAW AND JURISDICTION..........................10
THIS DEED is made the 8th day of September 2000
----------
BETWEEN:
-------
(1) CANARGO ENERGY CORPORATION whose registered office is at 32
----------------------------
Loockerman Square Suite L-100 Dover Delaware 19904 Dover Kent(address
for service in the UK c/o McGrigor Donald 63 Queen Victoria Street
London EC4N 4ST ("the Tenant") and
(2) GROSVENOR WEST END PROPERTIES ( Company Registration Number 956235)
-----------------------------
whose registered office is at 70 Grosvenor Street London W1X 9DB ("the
Landlord")
WHEREAS:
-------
(1) The premises briefly described as first and second floors 148/150
Buckingham Palace Road London SW1 ("the Premises") were demised for a
term often years from 24 June 2000 by an underlease ("the Lease") of
even date herewith made between (1) the Landlord and (2) the Tenant
(2) This Deed is supplemental to the Lease
(3) For the purposes of Section 3(6)(a) of the Landlord and Tenant
(Covenants) Act 1995 the burden an (without prejudice to Clauses
6 and 7) benefit of the Landlord's and the Tenant's obligations in
this Deed are personal to each of them
(4) It was a condition precedent to the grant of the Lease that on
completion thereof the Tenant would enter into this Deed
NOW IT IS AGREED as follows:
----------------
INTERPRETATION
--------------
1. In this Deed the headings and index shall be ignored in its construction
and unless the context otherwise requires:
1.1 References to numbered Clauses are to the Clauses hereof so numbered
1.2 Whenever the Landlord or the Tenant is more than one person their
respective obligations are joint and several
1.3 The expression "the Lease" includes any document entered into pursuant
thereto or which is expressed to be supplemental thereto
1.4 References to the term created by the Lease include any period of
holding-over extension continuance or renewal thereof whether by statute
or common law
1.5 References to Value Added Tax include any similar tax levied in addition
to or substitution for it
1.6 The following expressions have the meanings set against them:
"the Initial 83,395.00 (Eighty three thousand three hundred and ninety
Deposit" -five pounds)
"the Bank" National Westminster Bank plc or such other bank as the
Landlord from time to time nominates
"the Account" a separately identified deposit account at the Bank or
(pending payment of the initial Deposit into that account
and other than for the purposes of Clause 2.4) an
interest bearing client account of the Landlord's
Solicitors
"the Security the Initial Deposit together with any other sums paid
Deposit" into the Account by the Tenant pursuant to this Deed
and any interest credited to the Account which has not
been released to the Tenant
"the Tenant's the obligations of the Tenant in this Deed together with
Obligations the obligations of the Tenant to pay the rents reserved
by and to comply with theother lessee's obligations in
the Lease until it is lawfully assigned (other than by
operation of law) and thereafter the obligations of the
Tenant in any guarantee of the obligations of the person
to whom the Tenant has assigned the Lease
PAYMENT INTO ACCOUNT
----------------------
2.1 The Landlord acknowledges payment of the Initial Deposit by the Tenant
on or before the date hereof
2.2 The Landlord shall act and the Tenant hereby authorises the Landlord to
act in connection with the Security Deposit in accordance with this Deed
2.3 The Landlord and the Tenant shall give all necessary instructions to the
Bank to give effect to the terms of this Deed
2.4 The Landlord shall forthwith (if it has not done so already) pay the
Initial Deposit into the Account or (if the Account is not yet opened)
Shall procure that the Initial Deposit is forthwith placed by its
Solicitors in an interest bearing client account (subject until paid
into the Account to the other terms of this Deed) and open the Account
as soon as practicable and immediately thereafter procure that the
Security Deposit is transferred to the Account
OPERATION OF THE ACCOUNT
---------------------------
Withdrawal only by Landlord
------------------------------
3.1 Only the Landlord may withdraw monies from the Account
Interest
--------
3.2 All interest earned by the Account during such times as there is no
subsisting breach of the Tenant's Obligations shall belong to the Tenant
and shall be mandated direct to the Tenant at quarterly or such other
intervals as the Bank from time to time determines after payment of any
bank charges payable in respect of the Account and after deduction of
any tax as required by law PROVIDED THAT if there shall be any
--------------
subsisting breach of the Tenant's Obligations the interest shall be
retained in the Account until released pursuant to this Clause 3.2 or
to Clause 4 and accumulated and form part of the Security Deposit and
PROVIDED FURTHER that the Landlord shall notify the Tenant in the event
----------------
that it shall withhold monies pursuant to the provisions of this clause
Withdrawal for non-payment
----------------------------
3.3 The Landlord may withdraw from the Account for its own use the whole of
the Security Deposit or so much thereof as shall be required to satisfy
any such rent or other payment or sum if and whenever:
3.3.1 any rent or other payment due to the Landlord under the Lease
is not paid to the Landlord within seven days of the due date
for payment or
3.3.2 the Landlord incurs any other sums as a result of a failure by
the Tenant to comply with the Tenant's Obligations which are not
reimbursed by the Tenant to the Landlord within seven days of
being incurred
Insolvency
----------
3.4 The Landlord may withdraw from the Account and appropriate to such
purposes the whole or such part of the Security Deposit as the Landlord
requires to make good to the Landlord any loss or liability suffered
by the Landlord arising out of any breach of the Tenant's Obligations
which has then already arisen or which may thereafter arise if the
Tenant:
3.4.1 (being an individual) becomes bankrupt or is the subject of an
interim order under the Insolvency Act 1986 or
3.4.2 (being a body corporate) enters into liquidation whether
voluntary or compulsory (other than voluntary iquidation for the
purposes of solvent reconstruction or amalgamation) or is the
subject of a petition for an administrative order or
has a receiver or a receiver and manager or an administrative
receiver appointed in respect of the whole or any part of its
undertaking or assets
Forfeiture and disclaimer
---------------------------
3.5 If the Lease is forfeited or is disclaimed by a trustee in bankruptcy
liquidator the Treasury Solicitor or any other competent person or if
the Tenant (being a body corporate) is otherwise dissolved wound up or
ceases to exist then the Landlord may withdraw from the Account and
appropriate the whole or such part of the Security Deposit as the
Landlord requires and apply the same in discharge of:
3.5.1 any loss damage or liability to the Landlord arising as a
result thereof or out of what would have been a breach of the
Tenant's Obligations if the Lease had not determined and
3.5.2 (to the extent not included in the above) an amount equal to the
rents reserved under the Lease which would have been payable if
the Lease had not determined until the Landlord has relet the
whole of the Premises and all rent free periods applicable
thereto have expired
Notification of withdrawal
----------------------------
3.6 If the Landlord withdraws the whole or part of the Security Deposit
From the Account pursuant to Clauses 3.3 3.4 or 3.5 it shall in
Each case notify the Tenant in writing of the amount withdrawn
as far as reasonably practicable
No prejudice to other rights
--------------------------------
3.7 Any withdrawal from the Account shall be without prejudice to any
Other rights and remedies of the Landlord under the Lease or
Otherwise and any appropriation under Clause 3.4 shall not be
Deemed to be payment of rent under the terms of the Lease so as to
Prejudice the Landlord's right of re-entry in the Lease
Tenant to make up withdrawals
---------------------------------
3.8 Within fourteen days of receipt of any written notification under
Clause 3.6 the Tenant shall pay into the Account such sums as shall
when added to the monies remaining to the credit of the Account
(exclusive of any interest earned thereon) equal the aggregate of the
Initial Deposit and all sums previously paid into the Account under
Clauses 3.9 and 3.10
Rent reviews
-------------
3.9 If and whenever a review of rent takes place pursuant to the Lease the
Tenant shall within seven days of the date of ascertainment of the
amount of the increased rent pay into the Account a sum equivalent to
one half of the annual increase in the rent resulting from such review
Value Added Tax
-----------------
3.10.1 If at the time any sum is due under Clause 3.9 the rents (which
expression in Clause 3.10 excludes insurance contributions service
charges and reimbursement of other sums incurred by the Landlord
reserved as rent under the Lease) reserved by the Lease are subject to
the addition of Value Added Tax (or an amount equal to Value Added Tax
in respect thereof) the Tenant shall at that time also pay into the
Account an amount equal to the rate of such Value Added Tax then in
force on the sum due under Clause 3.9
3.10.2 If rents reserved by the Lease are at any time subject to the
addition of Value Added Tax (or an amount equal to Value Added Tax
thereon) and the rate of Value Added Tax on or in respect of such rents
at any time thereafter increases then the Tenant shall within fourteen
days after each such increase pay an amount equal to such increase in
the rate of Value Added Tax on the aggregate of the sums (other than
interest) which are then in the Account and the sums which ought then
to have been or are due within fourteen days thereafter to be paid into
the Account
RELEASE
-------
Date for release
------------------
4.1 THE Landlord shall release the Security Deposit or any remaining
Balance thereof together with all interest accrued thereon (less tax
and bank charges) to the Tenant within one month after the happening of
whichever of the following events first occurs:
4.1.1 the determination of the Lease (other than by reason of or in
connection with the events mentioned in 3.5)
4.1.2 Receipt by the Landlord of written notice of a lawful
assignment of the Lease (other than by operation of law) by a
person to whom the Lease shall have previously been lawfully
assigned (other than by operation of law)
4.1.3 the Tenant giving to the Landlord copies of its audited
accounts (and to the extent to which the Tenant has or ought
to have prepared such accounts for such period audited
consolidated accounts for itself and its subsidiaries) for
each of the three consecutive years immediately before that
date showing annual profits (before tax and extraordinary and
exceptional profits or income and excluding profits from
operations discontinued before that date) of an amount equal
to three times one year's Basic Rent (as defined in the Lease)
at the rate payable in respect of such date (ignoring any
suspension thereof under Clause 5.4 thereof)
TOGETHER WITH there being in the Landlord's reasonable opinion no ground to
--------------
suspect that the Tenant will not be able to comply with the Tenant's
Obligations thereafter PROVIDED THAT there shall be no release under Clause
-------------
4.1.3 for so long as any increase in the said Basic Rent is due but not
finally ascertained
Definition of Tenant in Clause 4.1.3
-----------------------------------------
4.2 References in Clause 4.1.3 to "the Tenant" are references only to the
person in whom the Lease is vested for the time being
No release during subsisting breach
---------------------------------------
4.3 (Notwithstanding Clause 4.1) if on occurrence of any event mentioned in
Clause 4.1 there is a subsisting breach of any of the Tenant's
Obligations which is capable of remedy the Landlord shall forthwith
notify the Tenant of such breach then the Landlord shall not be obliged
to release the Security Deposit until seven days after all such
breaches have been remedied to its reasonable satisfaction
NON-VITIATION
-------------
5. The Landlord may at any time without discharging in any way or
affecting any part of its security hereunder:
5.1 grant to the Tenant any time or indulgence
5.2 release to the Tenant such sums as it may from time to time at
its sole discretion determine
5.3 neglect or forbear to enforce the payment of the rents reserved
by the Lease or compliance with the Tenant's Obligations
5.4 refuse to accept any payment in order not to waive any right to
re-enter the Premises
5.5 release any security or guarantee held by the Landlord in
relation to the Tenant's Obligations
5.6 vary the Lease (including by accepting a surrender of part of
the Premises) or enter into or vary any other contract with the
Tenant
5.7 do or omit to do any other act or thing (other than a release
by Deed) by which the Tenant's liability would otherwise be
released in whole or part
ASSIGNMENT OF REVERSION
-------------------------
6.1 THE Landlord shall not assign the benefit of this Deed in whole or part
except to a person to whom the reversion immediately expectant on the
determination of the term created by the Lease is also transferred and
shall thereon either:
6.1.1 assign the same to such person and procure that such person
enters into covenants with the Tenant to comply with the
Landlord's obligations in this Deed or
6.1.2 discharge the security hereby created and repay the Security
Deposit
6.2 Each of the Tenant and its successors in title hereby releases each
person now or hereafter included in or comprising the Landlord from any
breach of the Landlord's obligations herein occurring after that
person's immediate assignee has given the covenant required by Clause
6.1
6.3 The covenants to be given by the Landlord's successors in title
pursuant to Clause 6.1 shall contain a release in the same terms
as Clause 6.2
ASSIGNMENT BY TENANT
----------------------
7.1 The Tenant shall not assign the benefit of this Deed in whole or part
except to a person to whom the term created by the Lease is also
transferred
7.2 The Tenant shall forthwith give written notice to the Landlord of any
such assignment and until the Landlord has been given such notice the
Landlord shall not be liable to the assignee if it repays the Security
Deposit to or pays interest to the assignor
CHARGE
------
8.1 The Tenant with full title guarantee charges its equitable interest in
the Security Deposit to the Landlord as security for the observance
and performance of the Tenant's Obligations
8.2 Any monies withdrawn from the Account or otherwise appropriated by the
Landlord in accordance with this Deed shall be thereby freed from the
Said charge and become the absolute property of the Landlord
8.3 The Security Deposit shall at all times be and remain in equity the
property of the Tenant but subject to the said charge
8.4 The security hereby created shall be a continuing security to the
Landlord and shall be in addition to and shall not operate so as in
anyway to prejudice or affect the obligations of the Tenant or any
other rights of the Landlord
VARIATION OF LEASE
--------------------
9. The right of re-entry in the Lease shall be exercisable if there is a
breach by the Tenant of any of the terms of this Deed while the Lease
is vested in the Tenant
GOVERNING LAW AND JURISDICTION
---------------------------------
10.1 This Deed shall be governed by and construed in accordance with the
laws of England and Wales
10.2 The parties hereto (which expression in this Clause includes their
respective successors in title and in the case of an individual his
personal representatives) hereby confer jurisdiction on the High Court
of Justice of England and Wales (hereinafter called "the High Court")
to settle all disputes which may arise in relation to this (other than
any which under the terms hereof are to be submitted for determination
to arbitration or to an independent expert or other person but
including where possible any appeal from the determination of any
dispute so submitted)
10.3 The Tenant hereby agrees that service of notices and other documents
(including originating process) relating to this Deed may be validly
effected at 63 Queen Victoria Street London EC4N 4ST or such other
address in England and Wales as it from time to time notifies in
writing to the other party hereto
IN WITNESS whereof this Deed has been duly executed by the parties hereto and
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is delivered as a Deed the day and year first above written
THE COMMON SEAL of CANARGO )
----------------- -------
ENERGY CORPORATION was hereunto )
-------------------
affixed in the presence of: )
/s/Russ Hammond
Russ Hammond
Director
/s/Nils Trulsvik
Nils Trulsvik
Director
